FHA Streamline Refinance

FHA Streamline Refinance

The FHA Streamline Refinance is reserved for homeowners with existing FHA mortgages and provides a path of least resistance for homeowners with their eye trained to mortgage payment savings.

With all of the above, it makes perfect sense for HUD to allow FHA borrowers to reduce their interest rate or flip their loan from an adjustable rate to a more stable fixed rate via a streamlined refinance process.

It’s good for FHA borrowers, but it is also good for HUD and FHA mortgage lenders because a reduced monthly payment equals less risk of default.

So, how does it work and how do you qualify?

How the FHA Streamline refinance works

FHA Streamline is a refi for homeowners currently in an FHA loan

“Cash-Out” not available (less than $2,000 only)

No appraisal required

Reduced documentation

Minimal credit requirements

Is an FHA Streamline refinance right for you?

If you’re in an FHA loan now and:

You are looking to reduce your monthly mortgage payment

You want to change from your adjustable rate mortgage into a more secure fixed rate mortgage

Your current mortgage rate is higher than today’s mortgage rates

You owe more on your mortgage than your home is worth

When appraised value gets involved you’re doing a standard FHA refinance that usually requires full documentation of income and assets to qualify. A different animal than the reduced doc FHA streamline.

For most homeowners, the “last known value” is the appraised value of the home at the date of purchase.

Normally, a 30-year FHA mortgage with the standard 3.5 percent down payment will reach 78% LTV in around 11 years. A 15-year fixed with 3.5 percent down would reach 78% LTV in less than three years.

Like mortgage insurance and product guidelines, personal situations change and – despite the fact the FHA streamline is a hugely useful mortgage product – you may be able to maximize your refinance savings through another loan program.

Always talk to your agent so they can guide you through the pros and cons of a variety loan options – including the FHA Streamline Refi.

NOTICE TO TEXAS CONSUMERS: COMPLAINTS REGARDING THE SERVICING OF YOUR MORTGAGE SHOULD BE SENT TO: THE DEPARTMENT OF SAVINGS AND MORTGAGE LENDING, 2601 N Lamar, Suite 201 Austin, TX 78705. A TOLL-FREE CONSUMER HOTLINE IS AVAILABLE AT 1-877-276-5550.